Fuel Prices Snap 14 Week Streak And Move Higher
Fuel prices have done something this week we haven’t seen since early June; they moved higher. According to GasBuddy, the national average for a gallon of gasoline inched up over three cents per gallon. This comes as West Texas Crude traded in the mid $70 per barrel range Monday.
So, why the disconnect?
Amrita Sen of Energy Aspects told CNBC Monday its all about Econ 101.
“The challenge right now, the micro, the fundamentals for oil are strong, but the macro picture is very bearish. With the stronger dollar, being here the pressure on emerging markets and the currencies is enormous so I struggle to see how crude is going to go up in the near term until these macro headwinds are still in place.”
One of the other remaining concerns when it comes to oil prices is China, which issued new COVID lock downs earlier this year, greatly cutting back oil demand. Sen noted after talking with her contacts in China and around the globe, that the country may be opening up a little faster than initially thought.
“We’ve got a very gradual opening after the 16th of October, but the real push for growth after April. It looks like the country is focused again on growth; growth has been absolutely horrible with real estate in dire straights so I do find myself a little more optimistic about the Chinese demand situation.”
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